Higher service tax makes mobile, eating out, travel expensive

NEW DELHI: Eating out, mobile phone usage and air & rail travel have become expensive from today with the government hikingservice tax rate to 14 per cent. The government's proposal to increase the rate of service tax from 12.36 per cent (including education cess) to 14 per cent has come into effect from today. The service tax is levied on all services, expect a small negative list. Some of the key services that attract higher tax and have become costlier include, rail andair travel, banking, insurance, advertising, architecture, construction, credit cards, event management and tour operators. Mobile operators and credit card companies have already sent messages to subscribers conveying the increase in service tax rate, which will have a bearing on the bills. Fares for First Class and AC classes in passenger trains, besides freight charges, have increased by about 0.5 per cent.   ET